Cost grows for defending overhaul of R.I. pension system

PROVIDENCE — The cost of defending the General Assembly’s attempts at pension reform has now hit $458,238.And the meter is still running: after meeting privately with the lawyers in the case on Tuesday,...

PROVIDENCE — The cost of defending the General Assembly’s attempts at pension reform has now hit $458,238.

And the meter is still running: after meeting privately with the lawyers in the case on Tuesday, Superior Court Judge Sarah Taft-Carter ordered another closed-door “status conference” for Nov. 21.

The bills are mounting, but with the parties under a gag order imposed by the judge, there has been no public progress report.

A week ago, General Treasurer Gina Raimondo’s office confirmed the $377,655 paid so far to the Adler Pollock & Sheehan law firm for defending the state, and to the actuarial consultants at Gabriel Roeder & Smith for their unseen role in the “litigation and mediation.”

Those costs were borne by the employees retirement system, as is routinely the case, according to Raimondo’s office, when the Employees Retirement System of Rhode Island is a named defendant in a case.

But that is not the end of the story. Two lawsuits have been rolled into one, now pending before Taft-Carter, who last January ordered the combatants to participate in closed-door talks, presided over by the Federal Mediation and Conciliation Service.

The state’s public employee unions are seeking to overturn the 2011 restructuring of the state’s pension system by the General Assembly and an earlier attempt by lawmakers to rein in the cost of the promises Rhode Island politicians made to public employees in rosier times.

By 2011, the annual taxpayer contributions to public-employee pensions had more than doubled, from $139 million in 2003 to $302 million in 2010, and were expected to double again to $621.8 million in 2012.

The attorney general’s office was responsible for 50 percent of the cost of hiring Adler Pollock & Sheehan — and, specifically, lawyer John A. Tarantino — to defend the governor and treasurer in the first round of the lawsuits, filed in 2010.

Kempe said the money to pay the legal bills has “come from the state’s tort settlement fund, which is set up to pay for litigation matters brought against the State. It is a line item in the state budget distributed by the Department of Administration. The legal bills are processed by the Office of Attorney General, which must be approved by the Court prior to payment.”

As to why the attorney general’s share of the bill has dwindled, she explained: “When “Pension 1” was filed, the decision to retain outside counsel was made by former AG Patrick Lynch…. When “Pension 2” was filed, Attorney General Kilmartin believed the Office could represent the State of Rhode Island without conflict.”

Who is “the state”?

In this case, she said: “It is the Governor and the Treasurer in their official capacities.”

When asked why the treasury isn’t using the same source of funding to defend the Employees Retirement System, Raimondo spokeswoman Joy Fox said: “ERSRI does not have access to the state’s tort settlement.”